APERC holds hearing on cross subsidy surcharge

Power distribution companies in the state have asked the AP Electricity Regulatory Commission (APERC) to review its order of August 13, which made open-access consumers default on payment of cross subsidy, along with additional subsidy, and ask the commission to determine the cross subsidy surcharge on the basis of embedded method followed in the past.

Discoms and open-access consumers presented their arguments on determination of cross subsidy surcharge for 2013-14 before the commission at a public hearing on Friday.

APERC had determined cross subsidy surcharge and additional surcharge, under provision of the Electricity Act 2013, payable by open-access users, falling in the service areas of respective distribution licensees as ‘Nil’ for 2013-14 but said discoms were free to approach the commission afresh if they could assure 100 per cent power supply to all subsidising consumers for at least four months consecutively.

Discoms termed APERC’s conclusion as contrary to the law and the result of the omission of several vital aspects of the matter. Hence the hearing on Friday.

Open-access consumers, who constitute basically industries and commercial establishments and also called subsidising consumers since the cross subsidy paid by them helps in giving power on subsidy to farmers and others, argue that since discoms are not able to assure continuous power supply they need not pay the cross subsidy and additional subsidy. Discoms argue that such an argument is flawed and cross subsidy surcharge is a compensatory surcharge.

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